Added by State Law 7-28 and State Law 7-74.
Subsection (4) amended by State Law 7-149.
Section 7.1303. Legal
characteristics and capacity of the Corporation.
In performing the
responsibilities and duties authorized by this act or other laws of the State,
the Corporation holds the capacity to exercise all powers reasonably necessary
to discharge its duties and responsibilities, including, but not limited to the
following:
(1) To adopt, alter and use an official seal.
(2) To adopt and amend bylaws and other rules, regulations and directives governing all aspects and duties granted to or imposed upon it by law. No bylaws, rules or regulation other than those covering the internal operation of the Corporation shall be adopted without a public shareholder meeting. Notice of a meeting. Notice of a meeting within this subsection shall be given to shareholders thirty (30) days prior to the Board of Directors meeting.
(3) To set interest charges or other monetary penalties, to require security deposits and create procedures for termination of service, and to establish such other procedures and policies to ensure timely payment of Corporation bills.
(4) To sue and be sued as an entity; provided that satisfaction of judgment or the settlement of claims or tort actions against the Corporation may only be paid out of contingency reserves or insurance held by the Corporation and not out of the other assets or operating capital of the Corporation, and for these purposes the doctrine of sovereign immunity is recognized and maintained for this public corporation to the extent not expressly waived by the State law.
(a) Notwithstanding subsection (4) above, the Corporation may pledge its assets or operating capital as collateral to secure a loan from the FSM Development Bank. If the Corporation fails to make any payment due under such a loan in a timely manner, the Corporation shall immediately inform the Governor and the Speaker to enable the State to take action to ensure that payment is made. The FSM Development Bank may also notify the Governor or the Speaker of any failure by MPC to make a timely loan payment. No foreclosure or acceleration of the debt is effective unless the Governor and Speaker receive a notice of nonpayment provided under this paragraph.
(5) To acquire in any lawful manner, real, personal, or mixed property, either tangible or intangible, to hold, maintain, use, and operate such property; and to sell, lease or otherwise dispose of such property.
(6) To acquire in any lawful manner and with consent of the entity, the business, property, assets, and liabilities of any public entity of the State to the extent it provides fuel.
(7) To borrow or raise any sums of money or such security and upon such terms as may from time to time be deemed necessary for the expansion and improvement of the Corporation's business.
(8) To retain and terminate the services of employees, agents, attorneys, auditors, and independent contractors upon such terms and conditions as the Corporation deems appropriate.
Background
Added by State Law 7-28. Amended by State Law
7-106 to add Subsection (4)(a).
Section 7.1304. Debts and
obligations of the Corporation.
Unless otherwise provided
by law, the debts and obligations of the Corporation are not the debts and
obligations of the Kosrae State Government, and the Kosrae State Government is
not responsible for any such debts or obligations.
Background
Added by State Law 7-28.
Section 7.1305. Composition of the Board, terms.
The Corporation is
governed by the Board of Directors. There shall be five (5) directors on
the Board appointed by the State of Kosrae. In addition to the five (5)
appointed directors, each shareholder possessing a twenty (20%) percent or more
ownership of outstanding stock, or his designee, shall serve as director.
The five appointed board members are nominated by the Governor, with the
advice and consent of the Legislature. An appointed Director serves for a
term of four years, subject to reappointment, and until his successor has
been appointed and qualifies. A vacancy of an appointed Director is filled
for the remainder of the terms for that vacated position.
Background
Added by State Law 7-28.
Section 7.1306. Meeting
of the Board.
The Board meets and holds
at least one annual shareholders' meeting. The Board may call other
meetings as it deems necessary for the transaction of its general
business.
Background
Added by State Law 7-28.
Section 7.1307. Organization of the board; quorum;
compensation and expenses.
Pursuant to its bylaws,
the Board organizes by electing one of its members as Chairman and another as
Vice-Chairman. The Board also designates from among its members a
Secretary to keep the minutes and records of the Board. A majority of the
Board constitutes a quorum, and a concurrence of a majority of its members is
necessary for any official action to be taken by the Board. No vacancy in
the membership of the Board impairs the right of a quorum to exercise all of the
rights and perform all of the duties of the Board. Directors are
compensated at prescribed rates, which may not exceed $50 per meeting, when they
physically attend meetings of the Board. All Directors, appointed by the
State of Kosrae, receive travel expenses and per diem at Kosrae State Government
rate when these amounts would be payable to Kosrae State government employees in
the same circumstances. Non-appointed Directors shall not receive travel
expenses or per diem from the Corporation.
Background
Added by State Law 7-28. Amended by State Law
7-60.
Section 7.1308. Appointment of General Manager, removal.
By a majority vote, the
Board appoints a General Manager and fixes his compensation. The General
Manager has full charge and control of the operation and management of the
Corporation and other real and personal property controlled by the Corporation,
and of construction and maintenance of any facility and necessary work on
vehicles, vessels and equipment controlled by or required to be built or
repaired by the Corporation. The Board may remove the General Manager for
good cause upon a majority vote. During any period when the position of
General Manager is vacant, the position is temporarily filled from within the
organization following its rules and regulations.
Background
Added by State Law 7-28.
Section 7.1309. Duties of
the General Manager.
The General Manager of
the Corporation has the following duties:
(1) To ensure that all fees and bills imposed by the Corporation are charged and collected.
(2) To attend all meetings of the Board and submit a general report on the affairs of the Corporation.
(3) To keep the Board advised on the needs of the Corporation.
(4) To approve demands for payment of obligations for the purposes and within amounts authorized by the Board.
(5) To prepare or have prepared all plans and specifications for the construction and repair of facilities, vehicles, vessels and equipment operated by the Corporation.
(6) To manage the day to day business of the Corporation; to select and appoint the employees of the Corporation except as otherwise provided in this act; to contract with independent contractors, and to plan, organize coordinate and control the services of such employees and contractors in the exercise of the powers of the Corporation under the general direction of the Board.
(7) To publish within 90 days after the end of each fiscal year, in the manner required by the Board, a complete financial and operations statement showing the result of operations for the preceding fiscal year and the financial status of the Corporation on the last day thereof.
(8) To perform such other additional duties as the Board may require.
Background
Added by State Law 7-28.
Section 7.1310. Appointment of Comptroller and general
counsel; duties of each.
The General Manager
appoints a comptroller and a general counsel, both of whom report to the General
Manager. The General Manager may terminate the comptroller and the general
counsel for good cause. The comptroller and the general counsel are
compensated at rates determined by the Board. Such officers may be
full-time employees of the Corporation, shared with the Kosrae State Government,
or be placed on retainer from the private sector. The General Manager may
appoint one or more assistants to any such office.
(1) The Comptroller has custody of all monies of the Corporation and pays out such money only in accordance with the direction of the Board and as provided in the annual budget of the Corporation. The Board appoints an agent as its trustee for payment of bonds issued by it and for such related purposes as the Board may provide.
(2) The general counsel advises the Board and the General Manager in all legal matters to which the Corporation is a party or in which the Corporation is legally interested and may represent the Corporation.
Background
Added by State Law 7-28.
Section 7.1311. Valuation, Accounting and reporting.
The Board adopts and
maintains a system of accounting that is in accordance with generally accepted
accounting principles applicable to public corporations. The system
adopted requires:
(1) That the Board employs a firm of independent certified public accountants or certified appraisers to determine the total value of the Corporation prior to any issuance of stock or sale of a minority interest. The Board shall transmit said report of the Corporation's valuation to the Governor and the Speaker prior to any issuance of stock or sale of a minority interest. The Board shall consult with the Governor and Speaker regarding the minority investment plan for the Corporation prior to any issuance of stock or sale of a minority interest.
(2) That the Board employs a firm of certified public accountants who annually examine and report to the Board the financial status of the Corporation, and that copies of such reports are furnished to the Governor and Legislature of Kosrae State, made available for distribution in the Corporation's headquarters to shareholders and transmitted to all shareholders owning at least five (5%) percent of the outstanding shares; and
(3) That the Board present to the Governor and Legislature of Kosrae State and all shareholders who own five (5%) percent or more of the outstanding shares an annual report on the affairs of the Corporation within 90 days after the end of each fiscal year. A copy of this annual report shall also be made available to all shareholders for their review at the Corporation's headquarters. When requested by the Governor or the Legislature, the Corporation shall present special reports within 60 days after the end of each intervening quarter.
Background
Added by State Law 7-28.
Section 7.1312. Budget preparation.
In consultation with the
Board, the General Manager prepares in advance of each fiscal year an annual
budget for the Corporation, taking into consideration, anticipated capital and
operational expenditures and anticipated revenues. The Corporation uses
the same fiscal calendar as the Kosrae State Government. The budget
indicates the operational, capital and maintenance requirements of the
Corporation that will be met with, the anticipated revenues of the Corporation
and such essential requirements as cannot be met without increase of revenues or
outside financial assistance.
Background
Added by State Law 7-28.
Section 7.1313. Increase
in the rate of services provided.
The Corporation may
increase the cost of diesel or gasoline fuel sold for domestic use in the State
of Kosrae, only after exhaustive consultations with the Governor and
Legislature, and they have concluded that such increases are not unreasonably
high, restrictive or discriminatory due to the abuse of the Corporation's
dominant position in the industry. Domestic use includes Kosraean fuel
retailers, majority owned Kosraean businesses and Kosrae State
Government.
The Corporation may increase or decrease
the price of aviation or jet fuel as it deems appropriate under common business
practices and contractual obligations. The Corporation may increase or
decrease the price of diesel or gasoline, for non-domestic use, as it deems
appropriate under common business practices and contractual
obligations.
The Corporation may increase or decrease
the price of fuel sold to the Kosrae Utilities Authority as it deems appropriate
under common business practices and contractual obligations, subject to a
maximum price equal to the actual purchase price for the fuel at the refinery
plus $0.40 per gallon. The Corporation shall provide a written explanation
to the Governor and the Speaker of the price to be charged for fuel sold to the
Kosrae Utilities Authority, including appropriate documentation of any change in
the refinery purchase price for the fuel.
Background
Added by State Law 7-28. Amended by State Law
7-125.
Section 7.1314. Deposit of excess revenue.
The General Manager in
consultation with the Board shall set aside sufficient funds from the revenues
of the Corporation to fund the operations, maintenance, expansion, loan
retirement and other legitimate financial needs of the Corporation. Any
excess revenue over and above the amount necessary to fund the legitimate
financial needs of the Corporation may be issued as dividends to the
shareholders of the Corporation after the close of each fiscal year as
determined by the Board; provided however that the aggregate amount of such
excess funds shall not be greater than 80% of the annual net profit of the
Corporation.
Background
Added by State Law 7-28.
Section 7.1315. Procurement; Manual of Administration.
The Board adopts
procurement regulations and establishes a Manual of Administration for the
Corporation including rules and regulations governing the selection, promotion,
performance, evaluation, demotion, suspension, dismissal and other disciplinary
rules for employees of the Corporation. Employees of the Corporation are
eligible to participate in any health insurance plan, life insurance plan,
retirement fund, and workmen's compensation funds available to Kosrae State
Government employees. The Corporation contributes to such programs as
determined by the governing authorities thereof.